Companies That Chose to Be Great Instead of Big
It’s hard to think of a book that has been mentioned to me more often in the past five years than Small Giants. Realizing how important it is for local small companies to locate, live, and give back to the Grand Traverse Region, it makes sense why many local business owners place Small Giants on their short lists of recommended reading.
Bo Burlingham the author of Small Giants started a quest roughly six years ago to find companies that have resisted the temptation to grow for the sake of growing. Instead these companies chose (on purpose or by accident) to focus on well conceived core values formed around their employees, communities, and customers.
This small giant philosophy counters the model that is pervasive in our culture, built on the premise of rapid growth and stock holder performance. Burlingham’s “Small Giants” are businesses that maintain their personality and success without succumbing to the siren song of potential mergers and public stock offerings (One can recall Ben & Jerry’s Ice Cream as the poster child for selling out and leaving one’s core mission behind).
The 14 companies Burlingham studies demonstrate a dedication to what is termed early on as “mojo” or the sustained success that customers, competitors and outside observers are drawn to while creating plenty of profits to go around. The intriguing part of Small Giants is divergent paths these businesses take to grow and remain dominant while remaining true to themselves.
Anchor Brewing saw its sales climb in the 1980’s when microbrew beers fist grew in popularity. With a small manageable location the company made the difficult choice to turn down a large account with a large Reno, Nevada casino. Declining the huge order was a defining moment for the company’s owner Fritz Maytag, and eventually served as a catalyst for Anchor Brewing to pursue an effective long term strategic plan.
Case studies of the other profiled businesses show this resistance to selling out and growing just to get to that proverbial “next level”. Instead they remain dedicated to their communities and employee driven cultures that created their success in the first place. This includes Cliff Bar and Co. owner Gary Erickson walking at the eleventh hour away from signing papers to sell his business to a large food conglomerate, musical performer Ani DiFranco shunning major recording labels to form her own recording company (Righteous Babe Records) in her hometown of Buffalo, and Zingerman’s Delicatessen growing lateral outshoot businesses in Ann Arbor rather than building a national chain of cookie cutter deli locations.
Although these examples know when to say “no”, the compelling and useful parts of the book focus in on the featured companies’ emphasis on creativity; finances openly shared within the companies, and well conceived management systems.
It’s interesting to see how small companies in other parts of Michigan define success when reaching that plateau of high sales and profits. One can look to nearby Grand Rapids and see several longstanding hometown companies that grew immensely large and remained locally owned, thus staying close to their local neighborhoods and non-profits as a valued contributor to the community
A few here in our region became financially successful and eventually were targets for purchase from private equity firms and larger corporations. The owners of these companies may have taken the quick payout but their employees and communities became vulnerable to downsizing, outsourcing, or relocation.
The perspective Small Giants provides is an interesting contrast to the corporate behavior that almost led us to ruin since the book was written in 2005. There is much to be said to growing a business and in a way that cares for the people it serves, proving once again that bigger is not necessarily better.
There is plenty of hope and tremendous examples in Small Giants of great companies that will inspire anyone involved in small business, from the person writing that initial business plan to the well versed, experienced business owner.
Chris Wendel is the Regional Director for the Michigan Small Business and Technology Center in Traverse City (MI-SBTDC). Northwestern Michigan College and the MI-SBTDC are sponsoring the “Thriving, not just Surviving” business conference on October 22nd at the Hagerty Center in Traverse City. The all-day event includes relevant resources, speakers, and sessions for existing, new and aspiring small businesses. For further information call 231.995.1700.
Chris Wendel’s business book reviews appear monthly in the “Traverse City Business News”.